There’s no such thing as a crystal ball

Fred Wilson has a great piece on his blog about being asked to speak about “the technologies and technology strategies that he thinks will be especially significant moving forward”. He decided to avoid making predictions in favour of advocating getting down and dirty with the technologies and opportunities available today. I heartily agree!

As I wrote in my reply to his post, we were just discussing in our team how it seems that most people, when they decide a course of action in life or business, are actually not choosing an option today – rather, they first decide what the future will look like and work backwards, letting their idea of the future be the key determinate of what they should do now. But, as Fred points out, given that we definitely can’t know the future (and the number of bad predictions out there), that’s almost the equivalent of abdicating decision-making to pure chance. Fred’s audience want him to help them make decisions by reinforcing a particular view of the future that cannot be known.

A better approach, as Fred points out, is to firmly bring decision-making into the present, decide what you will do now, and in that way learn more about how the world is currently working.

However you shouldn’t completely ignore the future, particularly for big investments with long-term effects. In these cases, it’s important to appreciate the fact that multiple futures could evolve based on key sources of uncertainty, then look to hedge positions, create maximum optionality (small investments and many decision-points) and so and so forth. And you should always remain aware that a major event could still wipe everything out and it wouldn’t be your fault, and you shouldn’t let an unknown future stop you from taking a courageous decision. The world is uncertain and we just have to live with it.

Investing in being robust, understanding uncertainty and learning from today are much more important than trying to second-guess the future in my opinion, but unfortunately I don’t see many organisations or people operating that way. In my mind, scenario planning can help in ensuring robustness, spurring optionality and appreciating uncertainty, but it isn’t a technique for predicting what will come. That way lies false confidence and danger, danger.